In accordance with the PPSA parties now have the ability to use personal property as a security for payment or performance of an obligation. However, a security interest can only be registered on the PPSR if the contract or agreement between the parties allows for personal property to be used as security. It is not an automatic right.
The PPSR replaces the previous security registers a cross Australia. For example, REVS is no longer in existence.
If a party has the ability to register a security o n the PSSR it is essential that they do so as soon as possible. Failure to register a registrable security may result in the party being considered an unsecured creditor in the event of bankruptcy or liquidation.
It is essential that financiers and all business dealing in security, but in particular hire purchase, finance leases, operating leases and service providers, ensure that their terms and conditions or contracts are updated and include the ability to have a security interest registered on the PPSR.
Those parties that already have a contract in place which allows for a security interest over personal property need to ensure that the security interest is registered on the PPSR.
If you would like any assistance or legal advice in regard to the content of contracts or registering an interest on the PPSR please do not hesitate to contact us.
Should you have any queries, or require any specific advice in relation to the implications of the PPSA, PPSA terms in contracts or registering an interest on the PPSR please call us on (08) 9335 9877 or complete the form below to request an Introductory Consultation.